Government Motors, British Style
A History Lesson For Those Who Believe The World Began in 2001
Claire Berlinski on the pathetic British history with nationalized car companies:
British Leyland was born. It held 40 percent of the UK car market and within five years lost nearly a quarter of it.
Why? The early seventies saw ever more intense competition from continental auto manufacturers, as well as the rise of the Asian car tigers. Leyland’s management was inflexible and slow to adapt. The group had too many companies under its control, and they made similar, competing, outdated cars. The oil-price shock didn’t help. Neither did Leyland’s militant union. Led by Derek Robinson, an unapologetic Communist known as “Red Robbo,” the union embarked on a series of ruinous disputes with management, regularly bringing production to a standstill.
Leyland’s factories were overmanned, its equipment old, its cars ugly. Antique collectors with a keen sense of irony now cherish the dumpy Austin Allegro, known at the time as the Flying Pig. Available in beige, brown, and wilted-lettuce green, it leaked, and its rear windows spontaneously popped out. Its proudest design innovation was its squarish steering wheel. While Leyland was busy inventing the world’s first square wheel, the Germans were building the Volkswagen Golf, a stylish, family-friendly, fuel-efficient hatchback that quickly became one of the best-selling cars in history.
The rest of the piece is less humorous and more dire in its parallels to the present day, as the British spent 13 years pouring taxpayer money down this rathole. Margaret Thatcher was right to oppose the whole project – as Berlinski summarizes the Iron Lady’s thinking, “[i]f the economy was in crisis, she held, the government should waste less of the taxpayers’ money, not more” – but even Lady Thatcher lacked the political strength to stop subsidizing the misbegotten venture until almost the end of her tenure in office, thanks to the voting power of the auto workers whose jobs continued to exist solely as a matter of public charity.
Perhaps we can still learn a thing or two from real-world history before we spend the next decade going down the same dead-end road.